Whilst some donors have recommitted themselves to their pledges to increase or at least maintain current levels of ODA in the face of the financial crisis, others have already made public announcements on cuts. Are these cuts reflected in the data?
DAC donors actually reported a rise of 6.8% in ODA from 2008 and 2009, with some particularly large increases from some donors, including the United States, France and Japan. Only seven donor governments contributed less ODA in 2009 and we will have to see whether or not the pronouncements on aid will feed through to more uniform cuts in 2010. While some donors have made official declarations on reducing ODA, except in a few cases, most of the declarations were made at the end of 2009 or in 2010 and thus, given budgetary cycles, are unlikely to be seen in aid data until full final information is published on 2010 expenditure.
The question on whether or not humanitarian aid has been affected by the financial crisis is actually more complicated. This is partly a question of the data we have available, since we only have partial information for 2009, although that is about 90% of the usual yearly total. This preliminary data suggests that humanitarian aid certainly declined in 2009 – and in some cases, such as for Australia, Ireland, Japan, Spain, the Netherlands and the European Community, contractions in contributions were significant.
Humanitarian aid from all donors reporting to the DAC as a share of total ODA, 2000-2009
However, even this information is has to be read with some caution. For example the EC’s humanitarian aid fell in 2009 – but this would need to be set against a substantial increase (US$300 million) between 2007 and 2008. The same might be said for both Australia and Japan, where the smaller amounts of humanitarian aid in 2009 are still about 50% higher than they were in 2007.
Our initial analysis is inconclusive: we do not yet know whether the falls suggested in the initial data will actually stand true when final data is released at the end of 2010 or whether they will transpire to have been due to budgetary pressure or particular donor circumstances. That said, the potential impact of the financial crisis should not be overlooked. It has already shown signs of throwing millions more people into poverty. In 2009, the UN Department of Economic and Social Affairs (UN DESA) suggested that there were between 73 million and 100 million more new people living in poverty (living on or below US$1.25 per day). The UN Global Impact and Vulnerability Alert System (UN GIVAS) suggests 108 million. The World Bank suggests 89 million. So even though humanitarian aid would appear to be relatively isolated from periods of global recession, far more likely to suddenly rise due to large natural crises, there are concerns for the future. The pressure on country finances seems likely to continue; already in 2010 some donors have made or plan to make even more serious cuts in public expenditure to reduce their deficits, just at the time when overall need may drastically increase. There is a need for vigilance.
Annual changes in humanitarian and development aid, 1992-2009